A new public works project requires 300,000 hours of labor to complete a Suppose the labor market is perfectly competitive and the market wage is $20 What is the opportunity cost of the labor employed for the project b Suppose that there are currently unemployment among workers and that there are s...

a The workers could have earned 20300000 6000000 working at their best other job since labor markets ...

A new public works project requires 300,000 hours of labor to complete. a. Suppose the labor market

Question:

A new public works project requires 300,000 hours of labor to complete.
a. Suppose the labor market is perfectly competitive and the market wage is $20. What is the of the labor employed for the project?
b. Suppose that there are currently unemployment among workers and that there are some workers who would willingly work for $12 per hour. What is the of the employed? Does this vary depending on the fraction of would-be unemployed workers hired for the project?
c. If your answers to (a) and (1) differ, explain why.
Opportunity Cost
Opportunity cost is the profit lost when one alternative is selected over another. The Opportunity Cost refers to the expected returns from the second best alternative use of resources that are foregone due to the scarcity of resources such as land,...